In another life, I would probably be a psychologist not because I am crazy about humans but because I find them very interesting. In this life, though the life of the pen and case analysis choose me and no matter how bad it’s going, I love it. What is there not to find interesting about the most intelligent species to walk on the planet earth and now maybe even Mars? Just like anything though, some humans are more fascinating than others depending on your preference. One particular group that interests me are entrepreneurs (I hope I got that spelling right). These I think have a special reservation in heaven for the one, too many troubles earthly governments cause them all while they try to give solutions to societies’ problems and build nations one solution at a time.
On Tuesday the 20th of April, the Rotaract club of Nairobi Central had invited three such individuals to dine virtually with us. One returning guest to the club and CEO of LRX group Bhavya Barot played an exceptional role as the moderator of our SME round table. The two other gentlemen invited were Fred Kithinzi, Founder and CEO of Belva digital and Sheel Shah, COO and Ghana Country lead at Pezesha Africa Limited. As tradition dictates, we started the meeting with members introducing themselves, some stating their expectations for the meeting and what they hoped to learn. Turns out I was not the only one fascinated about entrepreneurs! Even their counterparts in employment seemed eager and excited to hear what nuggets these gentlemen would offer at our round table dubbed # BuildingBackBetter.
The moderator started off the session by asking our guests to tell us their stories, who they are and how they ended up where they are. The next few lines might shock you, brace yourself. As a child the CEO of Belva digital wanted to be a truck driver, though fell in love with computers, and pursued an Undergraduate degree in Computer Science. He had the opportunity to experience in the early stages of his career the internet ecosystem which led to the desire to start Belva digital to leverage value out of the internet ecosystem for businesses. He helps his clients leverage value by helping build digital assets such as websites, bringing clients’ audience to the said assets and creating creative content because as the saying goes “Content is King.” The COO and Ghana country lead at Pezesha Africa is a qualified actuary who started out advising pension schemes in London and later coming back home to Kenya to help grow SMEs across Kenya, Uganda and Ghana.
Challenges when starting and sacrifices that they have had to make
In business just like in life, you face challenges especially while starting off and during the carrying out of your business you realize you have to make a few sacrifices, a choice many businesses had to make when the pandemic hit. This is what our guests had to say about their challenges and the sacrifices they had to make.
The most prominent challenge when starting is the finance to scale up as most people use up their savings especially coming from employment. Cash here becomes King. Plan and do proper market research as this allows you to exactly know the environment you are getting into. For example, Fred mentioned he started his business in an election year without the knowledge that election and business don’t sleep in the same bed. It’s important to prior understand how your intended clients work so that you can make informed decisions. If it’s the government for example, how do they conduct business? Do they pay on time? Finding mentors early enough might help one avoid some mistakes.
Some of the sacrifices that were made to stay in business include;
- Being very lean with cash; keeping the capital expenses on the down low and analyze how much runway you have in terms of cash to keep the business running.
- Change the business directions from growth to survival; allow employees to work from home and renegotiation of contracts such as rent with the landlord.
- Renegotiation of company debts in terms of interest rates to be able to pay back. Allowing customers discounts especially for the product already delivered to avoid total loss by collecting all the available cash was mentioned.
Survival and going strong
On this question, Fred and Sheel shed light on how they were able to survive and continue going strong:
- Sheel was able to forego the rent and allowed his employees to completely work from home, thankfully the transition was seamless and most staff after a survey they conducted were more comfortable and productive working from home
- Create a strong team even if small that can be able to handle the business.
- Address productivity with employees and ensure the team is coping well in the pandemic to optimize productivity.
- Taking up project-based contracts/shortened contracts at Belva digital helped bring in new people to the business as they were able to cater for businesses who were struggling to plan long term.
Belva digital came up with smaller packages that their clients would be able to afford, to help their clients grow and survive the pandemic as well.
Have you ever heard an argument or a presentation and afterwards go back to think you should have done something differently? Bhavya asked our guest what they would have done differently if they started a business again. They agreed that they would both plan more effectively by doing proper market research, avoid over-analyzing theories and accepting failure and moving on faster.
It wouldn’t have been an SME round table if we didn’t talk about startup, structures and systems. On this one they shared their view and like lawyers, said it all depends; the systems and structures that you set up for your company depend first on the business you are doing. If it’s a fast-growing business then definitely start setting up systems and structures early. However, if there is an important factor that any business should consider, keeping financial records should be it. Financial records may seem non-important when the money starts coming in but you need to have good financial records not just because it is good practice but because if in future you may want to get funded your records may save the deal. Start by even recording your sales and expenses and build slowly.
My favorite part of meetings is when they end because finally, I get to soak in the wisdom or just switch off my laptop. In this case it was definitely to soak in the wisdom with one of the guests recommending us to read the book Blue Ocean Strategy by Renee Mauborgne and W. Chan Kim and maybe create our own blue oceans. This caught me off guard but google is my friend and I am about to give you a spoiler of the first few sentences of what an article on google scholar describes the Blue Ocean Strategy as. “It is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. It is about creating and capturing uncontested market space thereby making the competition irrelevant. It is based on the view that market boundaries and industry structure are not a given and can be reconstructed by the actions and beliefs of the industry player.”
Thank you for coming to our website, go forth and create your blue ocean.